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Physicians Practice. Vol. 18 No. 1
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Physician Fee Schedule Survey — 2007

Tired of Being at the Mercy of Tight-fisted Payers?

By Shirley Grace | January 1, 2008


Cavale notes the public’s employers need to listen up and take action, as “the consumer is not really the consumer of care. They’ve delegated that option to their employers. … You must pay attention as an employer.”

This means performing due diligence when shopping for healthcare, says Madden, which she claims many employers don’t do. “You have a lot of employers just trying to keep costs low, and not really paying attention to quality of care. They leave it up to insurance companies. There needs to be a much bigger awareness of what are you buying and why you are buying it. It’s not a valuable proposition just because you saved $10,000 on Aetna over Cigna. [With employers and employees] working together, you’d be surprised how effective it is with insurance companies. It really forces their hand.”

How low will it go?

If trends continue, reimbursements will theoretically hit bottom in a few years, akin to an asteroid striking Earth while the dinosaurs munched happily on flora, fauna, and each other. “We’re in a changing world right now,” says Breeze. A growing movement of physicians are soliciting large groups and hospitals, looking for a stress-relieving salary payment structure, for example. Something’s gotta give, and soon.

Will we move to a single-payer system? Hard to say, although even if we do, “the devil’s in the details,” says Fabrizio, and implementation would take years. He suggests that only a major political shift will cause any major change in the current reimbursement slide. “There has to be changes by all the constituents. Unfortunately, I don’t see any movements to have everyone talking at the same table — the AMA, physicians’ groups, no one.”

Shirley Grace is a senior writer for Physicians Practice. She can be reached at sgrace@physicianspractice.com.

This article originally appeared in the January 2008 issue of Physicians Practice.

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Results from the 2007 Fee Schedule Survey are disturbingly similar to 2006: another sizeable drop in E&M visit reimbursement. Even more payer consolidation. And payers who stonewall on contract negotiation as a matter of policy. Specifically:

  • Average reimbursement for E&M allowables dropped to $73.48 — a 6.5 percent drop since 2006.

  • The Mountain region average E&M visit allowable fell 12.5 percent to $83, while, even worse, the Pacific region, lost another 9 percent last year after slipping more than 20 percent in 2006.

  • Reimbursements in urban areas, which have historically outranked suburban and rural areas, fell to the lowest of all three area types for the first time.

  • Primary care was hit the hardest, when compared to medical and surgical specialists.

  • One bright spot: New England, whose average reimbursement had tumbled 27 percent in just 12 months during 2006, reclaimed nearly 11 percent of that deficit, and now stands at the above-average $84.

    However, physicians can improve their leverage by trying these solutions:

  • Know your practice’s financial data, your costs, who your payer reps are, where your contracts are located, all of your contract renegotiation dates, how much money you want and why, and how to drop a carrier.

  • Follow up with your payers annually, and read each contract carefully, with an attorney’s help, if financially feasible.

  • Code and bill properly, and make sure the person(s) responsible for this are coding-certified.

  • Ramp up your patient collections by getting copays from patients while they’re still in your office, preverifying insurance coverage, and helping patients to manage their out-of-pocket costs better with automatic debit card payment plans, healthcare-specific “credit cards,” or online payment portals.

  • Advocate for yourself by writing letters to any political figure that makes sense, at all levels of government.

  • Tighten up your practice operations by making sure your processes are streamlined and your staffing is optimal.







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